Doug Patterson ABR®, SFR REALTOR®: Doug Patterson ABR® Broker-In-Charge (Park Place Real Estate, Broker-In-Charge)

I’m not a prude. I promise.

But I always wonder what’s up when I show a home that has nude paintings and photographs hanging on the wall.

The nudes don’t make me uncomfortable – but they might make some potential buyers uncomfortable. And an uncomfortable buyer may not remember all the good things about your home. They’ll just remember it as the house with all the nudies in it.

I showed a house yesterday that had an entire wall in the living room covered in nudes. Reproductions of old masters, contemporaries, abstracts. One that I could only surmise was the homeowner’s mother-in-law. Did my client talk about the magnificent fireplace? The wall of windows overlooking the lush back yard? The historic pocket doors? No. He started talking about the seller, and why he had amassed such a collection of nudes.

Even though Nudes and Neutralize start with the same letter, they sure have nothing to do with each other. When selling, Nudes out, Neutralize in!

Last year I had a listing where there was a large nude photograph in the dining room. Like I said, I’m not a prude. But it was a nude of the homeowner herself, as taken by her artist husband. It sure was a beautiful and artistic photograph. But it made even me uncomfortable knowing I was standing next to the (clothed) model at the time.

She asked me if it would be alright if they left the picture hanging while trying to sell their home. It’s so easy to hypothetically say “no” to that question, but not so easy to do in real life! I put it in the same category of questions as, “Do these pants make me look fat?”

My advice to all people trying to sell their home: Lose the nudes. If you have to ask yourself (or your Realtor) if something might not be conducive to a sale, you already know what the answer is. “Is this picture too risqué? Should I take it down?” YES!

Remember, No Nudes is Good Nudes.

Richard Strahm
Realtor, ABR, SFR, SRES

439 Main Street
Harleysville, PA 19438

Direct: (215) 853-2624
Office: (215) 256-1200 x-223
Fax: (215) 529-8931

Email:  Richard@RichardStrahm.com

www.RichardStrahm.com

PA Lic # RS310765

Copyright © 2010 Richard Strahm.   All rights reserved worldwide.

The current market does not favor buyers.  I repeat, the current market does not favor buyers.

Allow me to explain.  For months, if not years, you have been told that the glut of housing inventory makes for a buyer’s market of epic proportions. Why, the ancient Greeks themselves would write songs about the opportunities that abound for any would-be hero with a hankering for a house.  The only problem with this suggestion?  It’s just not true.

What is a buyer’s market?  Most would define it as a preponderance of available supply and an accompanying dearth of demand.  Let’s take a look at both aspects of that equation.

In a perfect financial world, a buyer waits for the market stars to align in just such a manner before swooping in to claim a nest at a fraction of the “normal” cost.  It all works great in theory, but real world application necessitates that the prospective buyer be subjected to the same set of variables that has drawn down the pool of demand at large. It’s a buyer’s market when few have the wherewithal to actually buy.

Appraisal difficulties and tightened lending regulations are contributing to a somewhat artificial suppression of demand. The “want” is present in the market. Consumers want to buy houses. They want to take advantage of the greatly reduced pricing and sublimely low interest rates. Homeowners want to refinance their houses so that they can stay in them, thus contributing to the lowering of the overall supply.

Want has nothing to do with it. Without ability, all of the consumer confidence and desire does not translate to actionable demand.

So to clarify the lead-in to this post, the current Scottsdale Real Estate market does not favor ALL prospective buyers, as the “buyer’s market” connotation suggests.

Further, the favorable conditions for those who are in positions to purchase do not necessarily translate to negotiable strength. Well-heeled cash buyers, W2 employees with verifiable income, solid credit history/scores, etc will find that they do not call the shots to the extent that they were led to believe. The bargain bin of bank-owned foreclosures is incredibly crowded. You are elbow to elbow with competing consumers when a new shipment arrives. The mom & pop resellers, by and large, do not have the equitable flexibility to negotiate the 30-50% off of list price that many buyers envision. The short sale properties with the absurdly low price tags are, more often than not, pie-in-the-sky figments of the listing agent’s imagination. You submit an offer 10% off list price to the bank, which in turn proves to be 40% off the BPO (Broker’s Price Opinion) that is performed three months later. The bank tells you they will gladly approve the sale – for 75k more than you offered.

While the inflated inventory levels in the housing sector are cited often enough, it is not widely reported that the number of unencumbered properties available for purchase is far less.  In a market that is most assuredly not of the “see house, buy house” variety, the redaction of readily purchasable properties (due to competition in the low end, and lien encumbrances across the full pricing spectrum) tilts the negotiation playing field back towards center.  Neither party has a clear cut advantage when facing each other at the negotiating table.

The truth of the matter is that most of the savings that you can expect to uncover have already been factored into the asking price by the time a listing is brought to market. Sure, there will be those that require substantial negotiation, and plenty others still that simply fail to sell. Never underestimate one’s ability to overprice a house. These aren’t the homes you are most likely looking at, though. The ones that buyers are flocking to in droves are those that present the best value opportunities. And why not? Just be prepared for the competition that you did not think existed for said properties in this ballyhooed “buyer’s market.”

Trying to cobble “x” percent off the list price in circumstances in which others are offering “x” above the list price will only lead to frustration.  Don’t get greedy.  Do what it takes to lock up the lowest pricing the Valley has seen for seven to eight years (longer in some areas) while interest rates continue to hover around 5%, and you are well ahead of the game.

And lastly … smile.  You are the guy that so many lament not being right now.  You know, the hypothetical guy who spurs such proclamations at office parties and cocktail hours across the Valley:

“If I had two nickels to rub together right now, I’d buy every house on my block for less than I paid for my albatross back in ‘05.”

Originally posted at the Scottsdale Property Shop

 

 

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Yes, My Buyer Has the Money to Buy . . . Does Your Seller Have the Money to Sell? Get the facts on the seller's ability to sell, before putting the home on the market!

I believe it is pretty standard real estate practice in most areas to have a pre-qualification / pre-approval letter (or proof of funds), to submit to the seller along with the buyer's offer.  It reassures the seller and provides the buyer a stronger bargaining position.

In fact, experienced agents generally like to have a copy of this letter from the buyer's lender, before they even begin showing homes to the buyer. Kinda makes sense really.  Why waste everyone's time looking at, or making offers on, homes the buyer can't afford? That's nothing but a one-way ride down Heartbreak Alley for all concerned.

The seller's ability to sell on the other hand has always been assumed.  There is no request for a "lender clearance letter" from the seller, verifying that the seller can afford to sell, prior to an offer being submitted by a buyer. Of course, this is because part of a listing agent's responsibility should include getting payoff information and preparing a net sheet or estimate of proceeds for the seller when listing a property. So it makes sense that any offer accepted by the seller should ensure that the loan payoff and other closing expenses are covered, or the seller has sufficient cash on hand to close.

Because, yeah, it sucks pretty bad -- as recently happened to me -- to have to explain to your buyer just days before closing that well, see, the seller actually can't afford to sell at the agreed upon price. He in fact owes tens of thousands of dollars more than the agreed upon price. It's particularly bad to have to explain this to buyers who expressly said they weren't interested in looking at / offering on short sale properties, due to the hassles and delays involved. Uh, awkward . . .

It's one thing to embark on the short sale saga when forewarned and armed for battle, it's another to be blindsided by it.

Obviously in this business there are always unexpected turns and unforeseen scenarios that are hard to predict (the above case being one such extremely unusual transaction), but clearly this is not an isolated instance and I am not the only one to have had this experience.

I recently closed a transaction on a listing of mine here in Pickens County GA, where the young, first-time home buyer, was at closing for a second time within a couple of months. His prior transaction had fallen apart at the closing table, when it was "discovered" that the seller was selling short, without lender approval, and therefore couldn't close. (How it got that far without being flagged by someone sooner is beyond me.)

I now get calls from other agents who want to show my listings, but who preface the conversation with something like, "Can the seller close at this price? Is there a possibility it will be a short sale? Just thought I'd check before wasting my buyer's time . . ." Sounds like they too have been burned by the "undisclosed", "unknown" short sale.

I think we all get the fact that short sales are on the rise. They are part of our environment and will be for some time. But, just as we pre-qualify buyers, we need to pre-qualify sellers and disclose up front whether or not it is a short sale, or has the potential to be a short sale. It is also important to double-check the numbers before the seller accepts any offer, particularly if the offer is substantially lower than list price, or the home has been on the market for a while, not just as an essential part of our duty to our clients, but as a courtesy to other agents and the public as well.

Seems like common sense, but . . .

Trent D Cluley
Keller Willliams Realty - Select Partners
770-757-3399
EMAIL
www.PickensGeorgiaRealEstate.com

SEARCH ALL PICKENS COUNTY & NORTH GA HOMES AND LAND FOR SALE!

I freely pledge to pursue my calling as a real estate professional.

Protecting and promoting my clients will be my first consideration.

I will continually learn and strive to better myself in knowledge and expertise.

I will in all ways do my utmost to elevate the standards of my profession. 

I pledge to be honest at all times, and to treat appropriately the confidential information confided in me by my clients.

I will never give preference in my professional services based on race, color, national origin, religion, sex, familial status, sexual orientation, or disability. 

I will be forthright in disclosing to my clients all ways I earn income in connection with their transaction.

I will not provide a service that is outside of my field of expertise. 

I recognize that this profession is equally about relationships and people as it is about real estate and law.

Passion for my vocation, love for the people I meet, and dedication to this oath will define my life's work.

A lot of people are entitled to use VA home loan benefits. It’s easy to think of a specific segment of the military as a “typical VA customer”, but while there are enough people who fit that description to create an actual stereotype, they aren’t the only ones out there.

When you think about a VA loan borrower, do you first think of the military retiree? An old Master Sergeant, Chief, or Lieutenant Colonel looking for a place to settled down to enjoy those retirement checks? Those people are definitely in the demographic, but don’t be surprised when a young 20-something comes to you looking to buy that first home with a VA mortgage.

The Department of Veterans Affairs has something for everyone who is eligible and can meet the income and credit requirements. You stand a good chance of meeting someone as a first time home buyer looking for a VA home loan, because in many cases that first four to six years in the military has taught them a thing or two about long term planning, investing for the future, and trying to think ahead.

When you meet these younger buyers, where can you send them to get an education on the real estate buying process and their VA home loans? The Veterans Information Portal is a great place to begin because there’s a great deal of information collected under one site—not just VA home loans, either. It’s an introduction into a wider world of knowledge about VA benefits.

Next, a first time home buyer could use some information on VA loan limits in their state, which will help set realistic expectations for the house hunt. Another good thing for a first-time VA borrower to read up on?  The rules covering joint loans and co-signers.

An online resource for some good local real estate listings is also handy…this one I can’t provide links for—what do YOU do online for RE listings? Share your links with us, we’d love to see how RE agents are using the web in the local area to get the word out on new listings. And don’t forget about our offer to share leads with RE agents in search of military clients like the people I’ve been talking about here. It’s a standing offer.

 

 

Lending Guides and The “Loan Quality Initiative”

 

It’s on. Fannie Mae has put into effect their Loan Quality Initiative in order to prevent bad loans to happen. For home buyers and refinancing owners this will mean tougher times to secure a new loan. Does it sound familiar?

Fannie’s Loan Qualify Initiative took effect on July 1st of 2010 and lenders are now scanning files with even bigger and better lenses. The focus this time is on new, non-disclosed debt and lender most likely will be pulling your credit just before closing. The bank’s underwriter will be looking at 3 main things in particular, even after you get a loan approval.

 

• A new updated credit report will be pulled and the new numbers will be replacing the original ones from your loan application. If new debt exceeds a determined threshold, you loan could be denied

 

• Any changes on your FICO scores could prevent you for securing the loan. If your qualifying score (mid of three scores) has dropped below lending minimum standards, you could be subjected to a rate adjustment or your loan could be denied.

 

• Your credit inquiries will be checked in order to determine if you’ve been applying for more credit elsewhere. They will use this information at their discretion.

 

It’s important that you take care of your credit. Make sure you don’t make any changes on your credit between the time you applied for a loan and the time you hold the keys to your home or close your new loan on a refinance. In these days, a loan can be revoked right before closing and I’m sure you wouldn’t like to be the one to experience that.

 

Maria Marriott | Mortgage Advisor | CA DRE License#01372198

For information on Greater Sacramento Home Loans visit www.MySacramentoMortgage.com

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I'm sure we've all heard that expression. But there isn't a better time to recognize the impact of that saying than right NOW!

The clock is ticking on the home buyer credit, yet it amazes me how many buyers and sellers are still letting a few thousand dollars keep them from getting a contract signed!

I read a recent blog by my AR friend, Jane Peters, written on the subject of buyers nickel and diming the sellers to death. Over a $5000 roof (a roof, I might add, that wasn't expected to cause inspection or appraisal issues, by the way).

Now let's think about this: a $5,000 roof or the $8,000 first time home buyer tax credit??

Simple math points out that if the buyers make the offer with the roof as is (remember, no inspection or appraisal issues are expected) and the sellers accept it before the end of the month, the buyer is $3,000 to the good anyway.

But to take this one step further: let's say they continue to hold off hoping to get the seller down another $5,000, all for a roof that doesn't need to be replaced currently anyway, only to miss the contract deadline date and lose out on the $8,000 credit, they will pay for that mistake for over 25 years!

Here's how I figured that:

The monthly "savings" on a $5,000 lower price/lower loan amount is about $27 per month. If they mess around and don't come to terms on the contract by month end, they lose the $8,000 tax credit. If I divide the $8000 they stand to lose by the monthly "savings" they are hoping to gain of $27, the break even is over 296 months, or over 25 years!

And that's just simple math without taking other tax or financial factors into consideration like the value of current money (the $8k tax credit) vs borrowed money.

Views and opinions expressed on this site are not necessarily those of WR Starkey Mortgage.

  

 Ruth Vogt, Branch Manager

   Colorado LMB #LMB100023827

   www.MyLenderOfChoice.com

   rvogt@wrstarkey.com

 

Buying a condominium unit can be more involved than buying a single family home. This is because you have to worry about both the unit itself and the condominium project as a whole.

10 Questions You Must Ask Before Purchasing A Condominium Unit

To borrow from a famous phrase, not all condominiums are created equally. Some condominiums are very well run; some are quite poorly run and underfunded. Buyers interested in purchasing a condominium unit must do their homework:  not only about the condition of the individual unit they are interested in purchasing, but on the financial health and governance of the condominium as a whole. Remember, you are buying into the entire project as much as you are the unit, and your decision will impact your daily living and your ability to re-sell.

Here are the 10 questions buyers should ask when deciding to purchase a condominium unit:

1. What is the monthly condominium fee and what does it pay for? The monthly condominium fee can range quite dramatically from condominium to condominium. The fee is a by-product of the number of units, the annual expenses to maintain the common area, whether the condo is professionally managed or self-managed, the age and condition of the project, and other variables such as litigation. For budgeting and financing you need to know the monthly fee and exactly what you are getting for it.
2. What are the condominium rules & regulations? Condominium rules can prohibit pets, your ability to rent out the unit, and perform renovations. Make sure you carefully review the rules and regulations before buying.  Needless to say, the buyer's attorney should review and approval all condominium documents, including the master deed, declaration of trust/by-laws, covenants, unit deed and floor plans to ensure compliance with state condominium laws as well as Fannie Mae and FHA guidelines, as necessary.
   
3. How much money is in the capital reserve account and how much is funded annually? The capital reserve fund is like an insurance policy for the inevitable capital repairs every building requires. As a general rule, the fund should contain at least 10% of the annual revenue budget, and in the case of older projects, even more. If the capital reserve account is poorly funded, there is a higher risk of a special assessment.  Get a copy of the last 2 years budget, the current reserve account funding level and any capital reserve study.
   
4. Are there any contemplated or pending special assessments? Special assessments are one time fees for capital improvements payable by every unit owner. Some special assessments can run in the thousands, others like the Boston Harbor Towers $75 Million renovation project, in the millions. You need to be aware if you are buying a special assessment along with your unit.  It's a good idea to ask for the last 2 years of condominium meeting minutes to check what's been going on with the condomininium.
   
5. Is there a professional management company or is the association self-managed? A professional management company, while an added cost, can add great value to a condominium with well run governance and management of common areas.
6. Is the condominium involved in any pending legal actions? Legal disputes between owners, with developers or with the association can signal trouble and a poorly run organization. Legal action equals attorneys’ fees which are payable out of the condominium budget and could result in a special assessment.  In most states, you can run a search of the condominium association in the court database to check if they've been involved in recent lawsuits.
   
7. How many units are owner occupied? A large percentage of renters can create unwanted noise and neighbor issues. It can also raise re-sale and financing  issues with the new Fannie Mae and FHA condominium regulations which limit owner-occupancy rates. If your buyer is using conventional financing, check if it is a Fannie Mae approved condo. If FHA financing, check if it's an FHA approved condo. (Thanks Lou Corcoran for the links) 
   
8. What is the condominium fee delinquency rate? Again, a signal of financial trouble, and Fannie Mae and FHA want to see the rate at 15% or less.
9. Do unit owners have exclusive easements or right to use certain common areas such as porches, decks, storage spaces and parking spaces? Condominiums differ as to how they structure the “ownership” of certain amenities such as roof decks, porches, storage spaces and parking spaces. Sometimes, they are truly “deeded” with the unit, so the unit owner has sole responsibility for maintenance and repairs. Sometimes, they are common areas in which the unit owner has the exclusive right to use, but the maintenance and repair is left with the association.  Review the Master Deed and Unit Deed on this one.
   
10. What Does The Master Insurance Policy Cover? The condominium should have up to $1M or more in coverage under their master condominium policy. For buyer's own protection, they should always buy an individual HO-6 policy covering the interior and contents of the unit, because the master policy and condo by-laws may not cover all damage to their personal possessions and interior damage in case of a roof leak, water pipe burst or other problem arising from a common area element. Ask for a copy of the master insurance policy and don't forget to check the fine print of the by-laws.  Sometimes, there's language that would hurt a unit owner in case of a common area casualty.  Condominiums over 20 units should also have fidelity insurance to protect against embezzlement.

Often a standard condominium questionnaire will answer all or most of these questions. In Mass., where I practice, this isn't required by law, nor is a seller disclosure. If not, be prepared to generate this list and incorporate it into your Offer to Purchase or Purchase and Sale Agreement, as the case may be in your home state. 

Either way, do not have your buyer put earnest money down until satisfactory answers are received.  Good luck and happy condo hunting to you and your buyers!